Myelin sheath is essential to normal conduction in nerves and is altered in multiple sclerosis and Guillain-Barre diseases. Understanding how myelin is formed and repaired requires basic studies of the differentiation of myelin-forming cells both in vitro and in vivo. To this aim, we are culturing myelin-forming cells in isolation, obtaining enriched populations, and studying the differentiation of these cells. Rat Schwann cells do not synthesize myelin products in the absence of axons, but synthesize components of their basement membrane, such as collagen type IV and laminin. Laminin strongly stimulates Schwann cell adhesion and elongation of their processes. Therefore, laminin may trigger Schwann cell differentiation in vivo during early stages of interaction with the axon. Laminin is also synthesized by astrocytes in the central nervous system and may play a role in modulating the shape of oligodendrocytes. In contrast to Schwann cells, oligodendrocytes, derived from rat brain or optic nerve, synthesize galactocerebroside and basic protein in isolation. Sensitive methods of in situ hybridization also allow us to detect the message for basic protein before the protein, itself. Basic protein may be translated on ribosomes in the oligodendrocyte processes close to the site of insertion of this protein into the myelin membrane. We are presently investigating whether myelin-associated glycoprotein (MAG) and proteolipid of myelin, two transmembrane proteins, are also expressed in isolated oligodendrocytes. Our in vivo studies on MAG show that this protein is consistently associated with the periaxonal space, appears to maintain the axon-Schwann cell contact, and is not found in compact myelin in normal and pathological nerves in vivo, such as in quaking mice. In patients with paraproteinemia and neuropathies, MAG has been shown to be an antigen recognized by monoclonal IgMs. The antigenic site recognized by these antibodies appears to be the carbohydrate moieties of the molecule and the patient's monoclonal IgM also reacts with gangliosides.